What’s Up, What’s Down: Higher Crude
Comments for Thursday, November 6, 2008
Looking Ahead to Today By Reflecting back at Wednesday’s price action
FINANCIALS:
Higher close yesterday for the eurodollars, bonds and notes and notes again. The eurodollars are still overall in an uptrend making another new recent high and close basis the December contract. The bonds are still in a downtrend overall but forming a large possible bottom while the 10 Year T-Notes gave me a buy signal today. Remember! Higher Note futures prices means lower Note yields.
ENERGIES:
Sharply higher for natural gas, crude and heating oil along with the RBOB. All of the energies had great closes with the RBOB making a key reversal. Now it’s important to see if there is a follow through overall the rest of the week. Usually the energies go lower the day following a sharp rally and then we should find out if a change in trend is on the way. However, the energies are still in major down trends.
GRAINS:
I still remain bearish on the grains, with the exception of soybean meal. Higher to sharply higher for Minneapolis, Kansas City and Chicago wheat along with oats, rough rice, soybeans, soymeal and soyoil.
The grains like almost all of the commodities settled higher following the emotional rally of the stock indices. The entire wheat complex continues to be in a downtrend but all are forming possible bottoms and those who have been short long term should lighten up or liquidate.
Corn settled higher again still in a major downtrend but consolidating while also trying to form a bottom. Rice closed up the daily 50 cent limit now very close to a buy signal. Oats closed higher in very thin trading still looking weak overall.
The bean complex closed higher like the rest of the grains with beans close to a buy signal but not quite there yet. Meal already has given me a buy signal but oil is still lagging behind as it attempts to form a bottom. However, the overall trends are still down.
Rick Alexander has been a broker and analyst in the futures business for over thirty years. He is a Vice-President for Sales and Trading at the Zaner Group (www.zaner.com) a Chicago-based futures brokerage firm. If you would like a free booklet explaining the charts mentioned above, email Rick at ralexander@zaner.com.